Bullish Sign? - Bounced off 200 EMA, page-2685

On NWH's margins and dwindling competition:

• NWH has historically being careful not to cut margins to land contracts;
• some competitors have fallen by the wayside;
• the work in the in the offing has increased, thus sucking up the sector's capacity and penchant to cut prices; and
• the attitude of large miners has shifted to certainty, quality of delivery, and other factors, in preference to focusing on the lowest tendered price.

On the last point, there are political considerations like Aboriginal engagement, support for local businesses, et cetera. I have often written before on the topic of working closely with customers in a win-win way, what I called modus cooperandi, and this is also a factor in NWH's favour.

On acquisitions, I do not believe that NWH has an appetite for acquisitions, which statistically can be shown to turn out badly more than well for the world as a whole, and which have caused numerous gung-ho managers to destroy wealth. Picking up fantastic bargains from peculiar sets of circumstances, as was the case with Golding and NCR, does not evidence an appetite for acquisitions, no more than stooping to pick up two diamonds serendipitously defecated by an ostrich would suggest an appetite to get into diamond mining.

The SP should, IMO, hover in the $2.35 – $2.40 range until a new Announcement or two confirms what most folk expect – more contracts to underpin FY20, FY21 and FY22. The FY19 Annual Report with its usual outlook statement should also induce folk to be more confident.

New word for the day – "serendipity", 1754: coined by Horace Walpole, suggested by The Three Princes of Serendip, the title of a fairy tale in which the heroes ‘were always making discoveries, by accidents and sagacity, of things they were not in quest of’.